Assigning Resource Costs to Activities, Resource Drivers, Primary and Secondary Activities Bob Rumo, cost accounting manager for emple Products, was asked to determine the costs of the activities performed within the company's Manufacturing Engineering Department. The department has the following activities: creating bills of materials (BOM), studying manufacturing capabilities, improving manufacturing processes training employees, and designing tools. The general ledger accounts reveal the following expenditures for Manufacturing Engineering Salaries $500,000 Equipment 100,000 Supplies 30,000 Total $630,000 The equipment is used for two activities: Improving processes and designing tools. The equipment's time is divided by two activities 40 percent for improving processes and 60 percent for designing tools. The salaries are for Nine engineers, one who earns $100,000 and eight who earn $50,000 each. The $100.000 engineer spends 40 percent of her time training employees in new processes and 60 percent of her time on improving processes One engineer spends 100 percent of her time on designing tools, and another engineer spends 100 percent of his time on improving processes. The remaning six engineers spend equal time on all activities Supplies are consumed in the following proportions Creating BOMS 10% Studying capabilities Improving processes 35 Training employees Designing tools After determining the costs of the engineering activitiet, Bob was then asked to describe how these costs would be assigned to jobs produced within the factory (The company manufactures machine parts on a job-order b) o responded by indicating that creating some and designing tools were the only primary activities. The remaining were secondary activibes. After some analyut, Bob concluded that studying manufacturing capabilities was an activity that enabled the other four actvities to bereid. He also noted that of the employees being trained are manufacturing work-oyees who work directly on the products. The major manufacturing en why the moment they hadiah Check My Work Previous Next > 5 20 30 104 Creating BOMS Studying capabilities 5 35 Improving processes Training employees 20 Designing tools 30 Nter determining the costs of the engineering activities, Sob was then asked to describe how these noits would be assigned to jobs produced within the factory (The company manufactures machine parts on a job-order) Bob responded by indicating that creating Home and designing tools were the only primary action The remaining were secondary activities. After some analysis, Bob concluded that studying manufacturing capabilities was an activity that enabled the other four activities to be realized. He noted that all of the employees being trained are manufacturing workers-mployees who work directly on the products. The major manufacturing activities are in die Inthing, welding, and assembly. The costs of these activities we wened to the various produce ang hour apending hours, dring hours, etc.). Furthermore, tools were designed to enable the production of the rule the process improvement activity focused only on the nve major manufacturing activities Required wing resource driven and direct tracing, calculate the costs of each manufacturing en av It required, round your answers to the nearest dollar Cout Activity Creating BOME The capabilities Improving processes Training employees Dening to
